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Tax effect of loss on sale of asset at the end of a project
Suppose an asset is sold for less than its book value at the end of a projects life, and generates a loss that is fully deductible from the firm's ordinary income.
The tax consequences from the sale of the asset will:
a) reduce the firm's tax liability
b) increase the firms tax liability
c) have no effect on the firms tax liability
We can't be sure how the project is going and we should check to see if all bills have been paid
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